The agreement comes one after it signed a similar OEM contract wafer-fabrication deal with Cisco to fabricate chips of Cisco design on behalf of the networking gear maker, heralding its entry into foundry chip fabrication businesses - a move to make the most use of its massive wafer-fabrication capacity.
As demand for chips are still sluggish, IDM, or integrated device manufacturers like Intel, are facing challenges of how to make the best use of cidle hip fabrication capacity to their low fab utilization rate.
The deal also adds fuel to increasingly intensifying competition for control of foundry chip business, as world’s second largest chip maker Samsung Electronics is upping its stakes in the contract chip-making businesses to steal a march on world’s largest foundry TSMC.
Altera’s FPGAs using Intel 14 nm technology will enable customers to design with the most advanced, highest-performing FPGAs in the industry," said John Daane, president, CEO and chairman of Altera. "In addition, Altera gains a tremendous competitive advantage at the high end in that we are the only major FPGA company with access to this technology."
Altera's next-generation products will include 14 nm, in addition to previously announced 20 nm technologies, extending the company's tailored product portfolio that meets myriad customer needs for performance, bandwidth and power efficiency across diverse end applications.
Yet, Altera will continue farm out production of 20nm and older FPGA chips to existing foundry maker TSMC.